As Lebanon's central bank chief avoids a court appearance, the scandal deepens.

Riad Salameh's absence from a judicial hearing adds to the mystery and consternation.

Riad Salameh is one of Lebanon's most well-known figures, having led the country's central bank for three decades. However, the veteran banker appeared to have vanished last week as State Security forces struggled to locate him after being charged with bringing him before a judge to be questioned about allegations of corruption and misconduct.


Officers were unable to locate him at either of his two homes or his office at Banque du Liban, leading to speculation that one of the world's longest-serving central bank governors had fled the country.


Even Lebanese who had grown tired of their country's fractious politics and angry at the ruling elite for mismanaging the crisis were taken aback by the extraordinary events. It also highlighted the escalating scandal surrounding Salameh, who many believe played a key role in the country's financial collapse.

And it all happened as Beirut resumed talks with the IMF on a rescue package necessary to prevent the country's economy from collapsing. The BdL's tens of billions of dollars in losses are at the heart of these discussions.


According to the Financial Times, Salameh was working normally at the BdL but did not show up for the judicial hearing. He claimed that the allegations against him were politically motivated and that he had done nothing wrong. In a phone interview last week, he said, "All the stories that some media put out are not substantiated. I’m in my house and the central bank. "


Salameh is under investigation in several European countries, including France, Germany, and Switzerland, for his financial dealings. He is the subject of judicial investigations in Lebanon, which are linked to both the overseas probes and a complaint brought by Lebanese activists, which is being investigated by Judge Ghada Aoun.


After Salameh failed to show up for previous hearings, Aoun ordered State Security to bring him to court last week. The governor has asked that Aoun, who imposed a travel ban on him in January after accusing her of bias, be replaced by the judiciary.


"I’m not saying I don’t want to be interrogated. I’m law-abiding, but I cannot accept to be interrogated by a judge who is already in hostility with me, " he said.


Salameh, who was once lauded for his handling of Lebanon's finances but is now accused of exacerbating the financial crisis by mismanaging the bank, declined to comment. Politicians who support Salameh, on the other hand, accuse President Michel Aoun of orchestrating a campaign against him. Despite the fact that they are not related, Judge Aoun is considered close to the head of state.


The president has stated that the Federal Reserve is to blame for the financial crisis. Despite this, billionaire businessman Najib Mikati, the Prime Minister, said in December that Salameh should keep his job, arguing that "one does not change their officers during a war."


Mikati was forced to deny allegations of judicial meddling two weeks later, following reports that he exerted pressure on a judge involved in the Salameh investigation.


Judge Aoun threatened legal action against the head of the Internal Security Forces last week for obstructing State Security forces' attempts to reach the governor, in yet another sign of the fractious relationships between state bodies.


The Salameh controversy, according to Sami Atallah, founding director of The Policy Initiative, a Beirut think tank, epitomizes Lebanon's political system's rot.


"We will not have justice as long as the ruling elite remain in power. We had a port explosion [in 2020] that destroyed a third of Beirut, we had a financial implosion that robbed citizens of their savings, and nobody is held accountable,” he said. “They [the ruling elite] make a mockery out of the judiciary system, they don’t want it to work. "


"Time is running out," he added, "and what is helping the case is the European investigations... They don’t care about Lebanese politics, so that adds pressure."


Salameh's legal woes began when Swiss authorities launched an investigation into allegations that the governor and his brother stole more than $300 million from the BdL through transactions with an offshore company. In 2020, Swiss investigators requested help from Lebanese authorities.


Salameh is adamantly opposed to any wrongdoing. He claimed that he had ordered an audit of his finances and that "not one dollar from the central bank that went into my account". He stated that he had presented the audit to Mikati as well as international authorities.


"I cannot make the audit public, " he explained, "but I gave it to the right authorities, they can use it as they wish."


Salameh's personal wealth has also fueled questions about his behavior. He claimed that when he was appointed governor in 1993, his net worth was $23 million after 20 years as a Merrill Lynch banker.


"So you can imagine $23mn in 1993, how much it can grow over 30 years,” he said. “I also had inheritance," he stated. He estimated his current net worth to be around $180 million, but noted that it "fluctuates."


"Those who are being proactive against me, I don’t know why . . . because essentially they have launched news, or rumours or unsubstantiated claims that I embezzled $2bn from the central bank," he said. "They cannot see this $2bn, so they are searching the world.”"


Some are beginning to doubt Salameh's ability to survive, despite the fact that he was once considered politically untouchable.


"“It’s incredible. I don’t think in history anything like that has ever happened," a veteran Lebanese banker said. "The noose is tightening rapidly — even in Lebanon it’s difficult for him to survive this." Salameh may be "unable to travel and confined to Lebanon, where he still has some degree of protection," according to him.


When asked if he could continue as governor in light of the investigations and travel ban, Salameh said, "I don't have any travel plans," adding that he would continue to perform his duties.


"I don’t know, if I have a mission to do, if this decision she [Aoun] took supersedes the interests of the country. We are speculating," he said. "I have a clear conscience, a clean record . . . when there’s politics in it nobody knows what can happen."

By fLEXI tEAM